Debt recovery is difficult, even with a well-paying job, so when you’re unemployed or lack income, the task becomes even more daunting. Monthly bills will continue to come, but your income isn’t so regular. While you’re searching to return to the workforce, you’ll also have to plan a way to stay afloat. Despite the stress that accompanies this situation, it’s still possible to manage debt, with the right preparation.
Here are 4 ways to deal with debt while seeking a job:
1. Call Your Creditors
When you’re dealing with debt and unemployment, the first step you should take is contacting your creditors, making them aware of your situation. Reputable creditors will appreciate a debtor that’s proactively reaching out before they’re forced to collect. Contacting them first will allow you to try to negotiate reduced interest charges, a deferred payment schedule, or enroll in a creditor hardship program.
When you contact your creditor be sure to do so in a professional manner, being clear and concise about your situation. Remember that it’s within the creditors best interest to talk to you because they want to get what they’re owed in some regard.
It’s also important to remember that entering into a creditor hardship program will show up in your credit history and impact your credit score. Seeking this kind of relief should be considered a last resort, but if you can’t make minimum payments, it is worth pursuing. Lenders don’t advertise hardship programs, so you’ll have to gather information through online research before contacting them.
2. Create a Budget
While you’re on the look-out for work, you’ll have to make a budget that reflects your current financial situation. The goal is to eliminate as many unnecessary bills as possible and to lower costs so you have the resources to cover the essentials, such as food and shelter. Cut out any avoidable spending, such as going out to eat, coffee, etc. You may also be able to negotiate your internet, cable, and phone plans for the time being.
Once you’ve made all possible cutbacks, you can create a budget that prioritizes where the money you have will go. The three most important expenses should be rent/mortgage, utilities, and food, but there are still ways to save in each of these areas. Consider taking in a roommate if plausible. For example, having someone paying you rent and assisting with utilities each month can be extremely helpful.
3. Debt Consolidation
One way to lessen the effects of debt during tough times is with debt consolidation. Debt consolidation involves combining what you owe into one lump payment with one interest fee. You then receive a loan to pay off all existing debt, and in turn make one monthly repayment to the lender. A debt consolidation loan generally has a lower interest rate than the previous debts and allows you to pay off everything in one monthly payment.
4. Debt Settlement
Debt settlement is another option to handle debts while you’re out of work. Debt settlement involves hiring a company to negotiate with your creditors to reduce your debt to a more affordable amount. During the process you’re connected to a specialist who will help weigh your options towards debt recovery. When deciding on a settlement you would then start making deposits into a secure escrow account. Your debt settlement specialist would approach your creditors with the intent of lowering the debt amount. This method of debt relief can have your debts eliminated in as little as 24 months. This option will still have you making monthly installments but just at a lower amount.
If you have any questions at all about how to deal with debt, consider contacting a professional debt relief consultant. Consultants can help provide you with the information you need to make the best decision for your financial future. Even if you don’t have a steady form of income, taking control of your finances and actively seeking help will get you on your way to financial freedom.
Financial Help from TLC
At TLC, we understand life happens. That’s why we’re always here to listen and help as much as we can. A personal loan with TLC can be the perfect response to any financial emergency. When you take a personal loan with us, the interest rate on your loan will depend on several factors including the type of loan you get, and your credit history. Will the loan interest rate stay the same throughout the life of the loan? Every loan from TLC has a fixed rate, which means your rate will not change for the entire term of your loan.
Once you have applied, the approval process is fast and easy; Once we receive your application, our customer service representatives will contact you to verify your income and employment, you will sign your loan agreement electronically and be all set to receive your funds. Once you have signed online, you’ll receive your loan in your bank account on the next business day.
And don’t forget, YOU ARE WITH A RELIABLE COMPANY:
- No Extra Fees, You Always Know What You Pay
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